Local Azure data centres to drive cloud growth

Earlier this year saw the launch of Microsoft data centres in South Africa. Located in Johannesburg and Cape Town, this world-class cloud infrastructure that will power emerging cloud, AI and edge computing innovations across the continent. Azure is the first of Microsoft’s intelligent cloud services to be delivered from the new datacentres. Office 365 and Dynamics 365 are anticipated for later in 2019. Lee Kuyper, COO of SilverBridge Holdings, believes this will provide local insurers with significant opportunities.

“For one, the benefits of the cloud become far more tangible for most businesses. Cloud computing has been around for a while but has always been something removed for most in Africa or something that happens ‘somewhere else’. With the new Microsoft data centre regions, it becomes something that is closer to home that can be practically implemented.”

Even though financial services organisations have become more open to move to the cloud in recent years, there has been a general hesitancy to fully embrace it.

Locally available

The new Microsoft Cloud region will offer the same enterprise-grade reliability and performance as offered in the over 40 cloud regions around the world with the added benefit of data residency.

“So far, the reception from our customers to these data centres has been positive. Although some have been working with and have embraced the cloud for a while, there are benefits to be realised from having the option of local data centres.”

For one, data is stored locally. South Africa’s two regions provide geographic redundancy capability, meaning that data replication can happen within the country for backup and recovery purposes. There will also be private connection available via Azure ExpressRoute which provides 99.95% dedicated availability.

Opportunity for the industry

“Insurance is an industry which is typically risk averse and in many cases for valid reason. Insurers deal with very sensitive customer information but also provide a critical service which requires a high level of credibility and trust. Having the option of local data centres just supports these underlying fundamentals. In addition, it also serves as a basis for the industry to drive innovation in terms of the way their customers interact with and experience insurance.”

The Microsoft cloud provides a level of security and compliance far beyond what any business could invest into on their own. Insurance is a highly regulated industry and by using the Microsoft cloud, insurers can tick many of the required boxes.

“From a regulatory point of view, local customers can rest assured that no data protection issues will be raised as all data is hosted within South African borders, rather than in other geographic regions. With these concerns removed, the improved speed and accessibility of new cloud environments as well as certain Azure functions that deliver better data and application management, will result in improved service delivery to customers.”

Furthermore, the fact that there are now physical Microsoft servers in the country mean SilverBridge customers can have a faster connection to the data centre thereby improving responsiveness of the applications on customer devices.

“Perceptions around the cloud are already changing even without the local data centres. However, their arrival will accelerate this and give South African business an improved ability to leverage the power of the Microsoft Cloud. Of course, the cloud on its own will not deliver the full value available. To really gain benefit, insurers will need to move towards business applications that are built for and that leverage the cloud not just from an infrastructure perspective but also from the wide range of services which are available on the platform.”

According to an IDC study, commissioned, spending on public cloud services in South Africa will nearly triple over the next five years, and the adoption of cloud services will generate nearly 112,000 net new jobs in South Africa by the end of 2022. The study also shows that increased utilisation of public cloud services and the additional investments into private and hybrid cloud solutions is enabling organisations in South Africa to focus on innovation and building “digital businesses at scale.” In turn, this enablement will help businesses generate close to R80 billion in new revenue over the next five years.

About SilverBridge

SilverBridge has over 20 years’ experience as a leading provider of insurance software solutions in the African financial services industry. Our footprint extends to 14 African countries. SilverBridge has introduced an enhanced service offering allowing financial services companies the opportunity to respond quickly to changing markets. With customers throughout Africa, SilverBridge has the knowledge, experience, and technology to help its clients do better business.

Insurers under pressure from PPR

The amended Policyholder Protection Rules (PPR) will have a significant impact on long-term insurance especially from a Group Risk perspective. Annalie Terblanche, product manager at SilverBridge, discusses what insurers need to be mindful of when it comes to these reforms.

“With these changes taking effect from October last year, insurers must significantly change not only how they communicate with policy holders, but also in the way group risk cover is designed, marketed, and managed from a claims perspective,” she says.

Under the amendments, the definition of a policyholder in a group scheme has changed from just being the employer or retirement fund, to now include all the members themselves. Insurers must therefore provide more detail around what cover is provided, possible exclusions, how costs and premiums are structured, the claims processes, to name just a few elements.

Data priorities

“The cornerstone of this will revolve around how effectively insurers have captured data in their systems. If their databases are not comprehensive or have not been kept updated with all relevant fields (think contact details, identity numbers, names, and so on), there is an administrative nightmare waiting to happen.”

She believes for an insurer to manage this process effectively it must work with a trusted service provider that has the technology available that automates as much of this as possible.

“Record-keeping becomes vital and if communication with a member is not done in accordance to the amendments, the insurer risks significant financial and reputational damage. Leveraging technology to assist in the process will become even more critical. If insurers have underestimated the scope of the amendments they must now prioritise getting their systems in line with integrated data management processes,” she says.

Partner role

Part of ensuring the insurer complies with PPR regulation is working with a trusted partner that has the solutions in place to streamline the process.

“For our part, SilverBridge has developed the FAISapp that addresses a number of PPR requirements. This includes recording, managing, and reporting on all complaints received from members. Furthermore, our policy administration solution Exergy has all the functionality required to make sure compliance is taken care of,” she says.

This is essential as the insurer now needs to communicate with the individual member from submission of the claim through to the final decision. Exergy already provides this functionality as members are administered as policy holders in addition to the employer.

“Existing Exergy users must make sure that they collect the correct data from employers. All system functionality is in place, so there is no need to upgrade or search for new solutions. We are providing customers with an environment that enables them to remain focused on their processes and core objectives,” she concludes.

About SilverBridge

SilverBridge has over 20 years’ experience as a leading provider of insurance software solutions in the African financial services industry. Our footprint extends to 14 African countries. SilverBridge has introduced an enhanced service offering allowing financial services companies the opportunity to respond quickly to changing markets. With customers throughout Africa, SilverBridge has the knowledge, experience, and technology to help its clients do better business.

FAIS Fit and Proper Compliance a business imperative

The Financial Advisory and Intermediary Services Act (FAIS) is designed to create a professional code of conduct with specific outcomes and measurements which Financial Services Providers (FSPs) must comply with. Angelique Strumpher, Administration Manager at SilverBridge, takes a closer look.

All parties across the insurance value chain (Insurers, Underwriters, Intermediaries, Brokers, Consultants, Agents and Representatives) are accountable for the type of and suitability of financial products sold, customer information gathered in terms of “know your customer”, the needs analysis conducted, if the new policy constitutes a replacement policy, and the type of advice given.

According to Strumpher, a potential customer should be assured that interactions with their chosen product provider is done in an honest manner, they have not been taken advantage of, their financial interests and position have been considered, and their rights have been protected.

Non-compliance with FAIS can include fines up to one million rand and / or imprisonment of up to 10 (ten) years as well as the suspension of your FSP licence and debarment of a Representative.

“FAIS Fit & Proper competency requirements is needed across all financial sectors to ensure that customers get the best service and advice from industry experts. Accomplishing this has been a journey that started in 2002. It is continuously evolving based on customer experience and expectations from service providers, industry complaints, and FSCA findings in terms of irregularities. This constant evolution of FAIS Fit and Proper and TCF standards remains an expensive undertaking for any business within the financial services and insurance industry.”

Awareness of compliance has been a priority since the process began more than a decade ago. FSPs are all governed and guided by a host of Acts of which the FAIS Act and subsequent Board Notices overseen by the FSCA (Financial Sector Conduct Authority), previously the FSB (Financial Services Board) has been key. A great way of ensuring that you are always aligned to Fit & Proper requirements as well as all prescribed Acts is to subscribe to the FSCA’s electronic newsletter.“What FSPs struggle with most are ineffective, time-consuming manual processes to manage FAIS Fit & Proper, Product Specific Training, Competency requirements, and electronic record-keeping of data and documents in a central place where the information is easily accessible and retrievable. Technology is an enabler that assists in demonstrating that you as an FSP are operationally compliant with legislated regulatory requirements and you have ticked all the prescribed governance boxes,” she says.

An FSP is required to have their own solution that supports all aspects of FAIS Fit & Proper as per Board Notice 194 of 2017. The adoption of a robust software solution can assist with effective automated and digital management of this end to end process as agile and cost effectively as possible. Learn more about our FAISapp by visiting www.silverbridge.co.za.

About SilverBridge

SilverBridge has over 20 years’ experience as a leading provider of insurance software solutions in the African financial services industry. Our footprint extends to 14 African countries. SilverBridge has introduced an enhanced service offering allowing financial services companies the opportunity to respond quickly to changing markets. With customers throughout Africa, SilverBridge has the knowledge, experience, and technology to help its clients do better business.

Marketplace model provides insurers with opportunities

Marketplace model provides insurers with opportunities

Nelson Camara, marketing at SilverBridge

With consumers expecting their service providers to deliver more tailored products providing better experiences at more cost-effective rates, insurers are under pressure to adapt their business models to ones better suited to this new environment. Given its mainstream appeal and success in driving adoption of mobile apps, the marketplace model has emerged as such an enabler.

While end-users understand how marketplaces work (think the Apple App Store and Google Play), it provides insurers with an opportunity to create an enabling platform for future growth. For example, in the music industry EVAmore has emerged as a convenient way for people to book musicians for their events. Previously, the process involved either knowing someone in the industry or having to go through agents which typically charge premium rates.

However, EVAmore adopted a marketplace model that lets customers create free listings including time, location, budget, and music genres required, with artists able to search for and ‘pitch’ to play at the gigs. The marketplace platform manages all the back-end payment and messaging between customer and artist to remove the cumbersome traditional way of making bookings.

With the marketplace model presenting insurers with opportunities to better engage with customers and meet future demand, decision-makers need to carefully asses how best to integrate it into its existing operations.

Customisation

Most insurers already offer a unique suite of products. Typically, these are developed in-house and are nuanced to meet customer demographic requirements. However, no insurer can be the best at every solution or even cater for every possible client requirement.

Whether through lack of resources or just difficulties in keeping up with continually evolving trends, insurers are realising that they need to rethink how they approach meeting customer requirements in the modern world. This requires the organisation to take a step back and focus on how it will meet customer needs to create a more enabling experience, reduce cost of development, and minimise churn.

Going to market

The marketplace model provides insurers with an exciting new option to enhance their existing business models. In this dynamic, an insurer will provide customers with access to third parties that have the best products in each segment as the means to complement their own solutions. Think about it as a one-stop shop where a customer can go for the best insurance experience at the lowest costs and able to select an offering tailored to their specific needs.

So, just like with a mobile app store, the end-users get continuous access to the best products and services in the market. For the insurer, it is an effective way to reduce churn while at the same time build a reputation as a solution provider that empowers its customers with the best possible products.

The marketplace model is poised to positively impact the insurance market. We expect to see movements in the industry that will result in many of the incumbents partnering with emerging insurtechs. These will be mutually beneficial agreements focused on delivering more value to customers.

About SilverBridge

SilverBridge has over 20 years’ experience as a leading provider of insurance software solutions in the African financial services industry. Our footprint extends to 14 African countries. SilverBridge has introduced an enhanced service offering allowing financial services companies the opportunity to respond quickly to changing markets. With more than 30 customers throughout Africa, SilverBridge has the knowledge, experience, and technology to help its clients do better business.